RESTRICTIONS ON EMPLOYMENT AND CONTROLLING PERSON.

(a) An appraisal management company registered under this chapter may not knowingly:

(1) employ a person in a position in which the person has the responsibility to order appraisals or to review completed appraisals if the person has had a license or certificate to act as an appraiser denied, revoked, or surrendered in lieu of revocation in any state;

(2) enter into any independent contractor arrangement for the provision of appraisals or appraisal management services with any person who has had a license or certificate to act as an appraiser denied, revoked, or surrendered in lieu of revocation in any state;

(3) enter into any contract, agreement, or other business relationship for the provision of appraisals or appraisal management services with any entity that employs, has entered into an independent contract arrangement, or has entered into any contract, agreement, or other business relationship with any person who has ever had a license or certificate to act as an appraiser denied, revoked, or surrendered in lieu of revocation in any state; or

(4) have, as a controlling person, a person who has had a license or certificate as an appraiser or a registration as an appraisal management company suspended, revoked, or put on probation in any state.

(b) An appraisal management company is not in violation of Subsection (a) if:

(1) the person whose license or certification was denied, revoked, or surrendered in lieu of revocation has subsequently had the license or certificate granted or reinstated;

(2) the license or certification was denied, revoked, or surrendered for a nonsubstantive reason as determined by the board; and

(3) the person maintains the license or certificate in good standing.